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S. Korea to expand scope of tax on financial investment gains from 2023 Updated: 2020-06-25 17:01:27 KST

From 2023, all shareholders, whether they are major or small investors, will be subject to tax on gains from financial investment.
This expands the scope of the tax, which currently only applies to those who own over around 831-thousand dollars in a single stock.
The new tax will be on net profit, with gains up to 16,500 U.S. dollars a year exempt.
The earnings above that will be taxed at 20 percent up until 250-thousand dollars, and at 25 percent for earnings above 250-thousand dollars.
The new rules also allow tax deductions to be carried forward for losses within three years.
As well as introducing a tax on gains, the government will gradually lower the tax on stock exchange transactions from point-two-five percent to point-one-five percent by 2023.
This comes as part of government plans for a revamp of the current financial tax system.

"Recently, there has been a rapid change in financial markets, as new financial products are being introduced. But the complicated financial tax system makes it harder for people to invest. So, we plan to revamp the system."

The government will introduce the new tax system in 2022 to impose levies on gains from stocks, funds, bonds and derivatives.
But the finance minister said he expects the burden on small investors will actually be alleviated due to the lower transaction tax.
He added only those in the top 5 percent of shareholders will be affected.
The finance ministry will come up with its final plan by the end of July, before putting it forward to the National Assembly.
The move brings Korea's financial taxes closer to other countries like the U.S. and Japan.
Yoon Jung-min, Arirang News.
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